Microsoft Office Tutorials and References

In Depth Information

**Using XNPV to Calculate the Net Present Value When the Payments Are Not Periodic**

Figure 13.14.

Figure 13.14.
You can determine a modified rate of return, figuring in a finan-

You can determine a modified rate of return, figuring in a finan-

cing rate and the interest rate for reinvested profits.

cing rate and the interest rate for reinvested profits.

Using

Using
XNPV

XNPV
tto Calculate

Calculate the

the Net

Net Present

Present Value

Value When

When the

the Payments

Payments Are

Are Not

Not

Periodic

The previous examples assume that everything happens on the last day of

each year. In reality, the business purchase date and the business sales

date might occur on other days. In such a case, you use XNPV.

Syntax

XNPV(rate,values,dates)

The XNPV function returns the net present value for a schedule of cash

flows that is not necessarily periodic. To calculate the net present value

for a series of cash flows that is periodic, you use the NPV function. The

XNPV function takes the following arguments:

•
rate

rate
—
This is the discount rate to apply to the cash flows.

•
values

values
—
This is a series of cash flows that corresponds to a

schedule of payments in dates. The first payment is optional and cor-

responds to a cost or payment that occurs at the beginning of the in-